FT Economists' Forum: My Response to Stiglitz and Stern
March 5, 2009 | Posted by Gernot Wagner in News
This week, Joe Stiglitz and Nick Stern published an opinion piece in the Financial Times titled "Obama's Chance to Lead the Green Recovery". They call for a "stable, strong" price for carbon, but do not say how that price should be set. I just posted a response in the FT's Economists' Forum. Here's how it begins:
Joe Stiglitz and Nick Stern are exactly right to emphasize the role President Barack Obama can play in leading the green recovery. They are also right to calling for a “stable, strong carbon price.” But it matters how that price is set. In the United States in particular, the right environmental, political and economic answer is a cap-and-trade system.
Take a look at the whole conversation. I also provided some more detail on the greenness of economic stimuli over at the Environmental Economics blog. Spoiler alert: China's trumps the United States' package 2:1.
